Flathead County District Court in Montana issued a preliminary injunction Thursday restoring the state’s school choice program after a new Department of Revenue rule had blocked families from using tax-credit scholarships to attend religiously affiliated schools.
The injunction will remain in place until further action by the court.
“When you exclude the religious school segment of the school marketplace, you are severely limiting the number of options where parents can send their children,” said Dick Komer, a senior attorney at the Institute for Justice.
The statute creating the school choice program, enacted in May 2015, allows qualifying students to go to any private school, many of which are have a religious affiliation, Komer said.
“By taking this step of writing an administrative rule, the DOR was acting, to put it in Latin, ultra vires, meaning acting on its own outside its delegated authority,” Komer said.
“This is an unusual case for us. Normally, the legislature writes the statute and the DOR writes the rules to make the program work,” said Komer. “The state pre-emptively wrote a rule to prevent the program from working.”
IJ filed the lawsuit against the DOR on Dec. 16. The plaintiffs represented by IJ are three mothers who want to send their children to Stillwater Christian School who wanted to apply for the state’s tax credit scholarship program.
The tax-credit scholarship is Montana’s first school choice program. It provides a credit of up to $150 annually to individuals and businesses that donate to private scholarship organizations. Those organizations then provide scholarships that allow families to send their children to private schools. Tax revenue is forgone, but no state money is spent.
In its new rule, the DOR said it had the authority under the state constitution to exclude religious schools from the program. At least for now, the court disagreed. Similar programs have passed court muster in other states.
Kendra Espinoza, one of the plaintiffs, was elated by the preliminary injunction. She took on a second job last year and fundraised so she could keep her two daughters in Stillwater Christian School.
“I am excited, relieved and so very grateful that my two daughters now have a chance at getting scholarships!” Espinoza said in a prepared statement.
Komer said IJ will seek a permanent injunction to block the rule.